The digital checklist for customer-centricity

Calling all retailers — how many of these are on your 2020 wishlist?
19 February 2020

The Sneaker Bar in Nike’s Melrose store. Source: Nike

No matter what sector a retailer or brand covers, whether they’re online, offline or omnichannel, many are waking up to the fact that they need to understand and serve consumers better.

And by ‘better’ we mean to empathize with the customer’s needs and preferences and deliver an experience that encourages them to buy more, more often, more profitably and in a way that reduces returns.

So, what exactly will big hitters be doing in 2020 to achieve greater customer-centricity? Here’s a checklist, inspired by Astound and Mulesoft’s latest report, Digital Transformation: Why Fast Isn’t Fast Enough.

Understanding online behavior better in order to justify new stores and specific in-store assortment

This point may seem a little counterintuitive at first, but customers’ online behavior is a really great way to measure demand for stores and assortment. Put simply if a retailer or brand has a high concentration of online customers in one geographic area, logic dictates this is an ideal place to site a store.

This is essentially the strategy pure-plays such as and use when opening physical stores. Membership site BrandAlley is also using this tactic to locate its planned pop-up stores. Take this strategy to its logical conclusion and you get Nike’s Melrose concept store in LA. This store regularly has its inventory rejigged according to the online browsing habits of Nike customers in the immediate vicinity – online and offline retail in lock-step.

NikePlus members can redeem product or rewards by using their member pass every two weeks. Source: Nike

Second-generation clienteling – delivering the data retailers need to cross an upsell

A single view of the customer, stock and order is an essential ingredient for any brand or retailer looking to increase customer-centricity. Store staff needs the full picture if they are going to sell effectively.

This entails knowing a customer’s online browsing habits, purchase history, average order value, their likes, and their wish lists when they come in-store. A customer may be a long-time user of a retailer’s website, so there’s no excuse to treat them like a stranger when they finally venture into the store.

Armed with the right data store, colleagues can be perfectly placed to cater to the customer’s specific needs and fast forward the buying journey.

Replacing points-based loyalty schemes with multi-channel reward apps

More and more brands are adopting omnichannel loyalty programs, which are proving to be very effective. Omnichannel loyalty connects customers to a brand across all touchpoints seamlessly and provides members with the opportunity to be rewarded for spend and engagement across all channels.

Omnichannel data capture also helps brands drive personalized communications and better customer experiences. US beauty giant Tarte’s recently launched its “tarte <3 rewards”  loyalty program, which rewards members for not only spending money with the brand but for sharing content on social media, referring friends and reading emails.

These activities keep members engaged and informed about the brand and help promote the brand benefits to a wider audience, turning members into brand advocates. The spend and engagement data captured can also be leveraged for future marketing efforts.

Digitizing the physical store

Retailers and brands are increasingly designing stores through an e-commerce lens, so they’re more than just mini-warehouses, they are brand ambassadors that build community and enhance customer loyalty.

Companies are achieving this in a number of ways including situational awareness of customers – using technology such as Bluetooth beacons to alert them when specific customers are in-store and using loyalty apps to share promotions and store event information in an effort to drive sales.

They are also giving store staff access to previously online-only functionality including access to the ‘endless aisle’, online conversational commerce, buy in-store/deliver to home and Click & Collect.

High street mobile phone retailer Three UK is a great example of how sector leaders are digitizing the physical store. It has invested heavily in enabling its in-store staff to chat with customers and live-stream reviews on its website and social channels. During a sales chat, customers who are not immediately converted are invited into their local store for a product demo.

Delivering next-generation personalization

For too long, retailers and brands have been content with the output of recommendation engines that analyze a customer’s order history and simply offer them more of the same, argues Pete Youell, Technical and Operations Director at Astound Commerce UK.

“The problem here is that having bought one pair of brown boots, why would a customer want another? Amazon, despite its mastery of data, is one of the guilty ones in this department,” he says.

In 2020, leading retailers and brands will be taking personalization to a new level, moving away from “you bought this, you might like this” to “this works with this”. Cosmetic retailer Sephora is one of the big names leading the drive for real personalization. It has already achieved a single view of the customer across all its channels, so it knows the ‘you’ in-store is the same as the ‘you’ online.

This is a great starting point for connecting its customers to the right mix of messages, beauty brands and products. Sephora doesn’t stop there, injecting personalization into marketing, customer service, and personalized experiences – both on and offline.

The key to greater customer-centricity is to place high-quality, easily actionable data into the hands of customer-facing salespeople. Only when retailers achieve tighter integration between ERP systems, e-commerce and efficient management of APIs, templates, and connectors, will it be possible to get closer to their customers.